You and I both know that you aren’t gonna be reading and digesting a long business article at this time of year, so we’ll keep it light this week.
Don’t ask me why, but I have, over the years, accumulated an enormous amount of real estate poetry. The muse usually strikes me around Christmas time, which explains the “Night Before Christmas Meets Dr. Seuss” nature of a lot of this. Anyway, it amuses me—hopefully, it will give you a little smile, too.
Ode to Holyoke Lane by Vena Jones-Cox
‘Tis the night before Christmas
And I bring a tale
Of five hard-learned lessons
From one little sale.
It’s a story of heartache,
Of trouble, of loss,
Of hassle and torment
And headache and cost
But before you can hear
How my cash and I parted,
You must first hear the story
Of how it all started.
An estate sale it was,
And in Forest Park, yet,
And the price was so low
That I went into debt
$60K, and the comps said
That price was just fine,
‘cause the value was closer
To 79.
And the “subject to” loan
Was especially sweet—
Just two thousand up front!
It was too good to beat
With a stick! And the home
Was in lovely condition:
4 bedrooms, 2 baths,
And a cute little kitchen,
With a little paint here
And a touch-up or two,
It was gonna be perfect!
So I said to Drew
That I knew it would rent
For a zillion or more!
Or at least seven hundred
And seventy four
(plus a buck, give or take),
So let’s take it and run!
‘Cause the PITI
Was just 691.
So I took it, and ran—
Into trouble galore!
And it taught me the lessons
I mentioned before.
Lesson One: Never buy,
Lest your profits be gone
Any house, ‘til you’ve seen
The utilities on,
Or you may find the basement
All filled up with wet,
‘cause the sewer line’s broken
And what is worse yet
Is it’s broken up under
A really big tree
That you’ll have to remove
And you bet THAT’S not free…
And what’s more it’ll be
7 weeks ‘til they fix it
At a cost of four thousand,
And that’s a tough biscuit.
But not quite as tough
As the cracked heat exchanger
That puts all your tenants—
And profits—in danger,
In a furnace so old
That it must be replaced
Once the ductwork,
which is (of course) asbestos-laced
has been dealt with by pros
in their pretty white suits
who take all of your ductwork
and most of your loot,
About thirty-five hundred,
In case you’re still guessin’,
Which brings me right back
To the rest of my lessons.
Lesson Two: when you hire
A person you trust
To fix up your properties,
Still, it’s a must
To stop by and check on him,
or you may find
That your trusted contractor
Is stealing you blind.
He might TELL you he’s toiling
Day after day
On the painting, and cleanout,
And needs to be paid
About two thousand bucks
Which might have a nice ring
‘til you find out that he
Hasn’t painted a thing,
‘cept the floors, which were hardwood
And didn’t need paint
And the cost to refinish them
Might make you faint!
Near five grand was the total
To get the job done,
Since I paid for it twice
But I only got one
Painted house for the price
And for all of that pain.
And the contractor?
I never saw him again.
Lesson Three has to do
With the outrageous cost
Of a vacancy.
Think of the money that’s lost
In 8 monthly payments
Of six ninety-one
Plus the water and gas
And the ads that you run
While you wait for your house
To be ready to rent.
Fifty-five hundred is
How much you’ve spent,
Or that I spent, that is,
And that’s hard to replace!
And still harder to look
At yourself in the face
And to say, “can it be
I’m a real estate louse?
I’ve spent 80 to own
A high 70’s house!”
Lesson 4 is a short one,
And stated just so:
Don’t EVER rent
To a person you know
Or your Mom knows,
Or whatever your case might be,
Or you’ll come to regret it,
For soon you will see
That with tenants, the thought is,
“we’re friends, which is great!
You’ll understand
when my payment is late!”
Since September, I’ve gotten 3 payments
Sublime!
(One check bounced, one was short,
And not one was on time).
Lesson five is the best one
I think you’ll agree,
‘cause it educates you
And it humbles poor me.
I’ve told you my story,
And this I do bid:
Do as I SAY,
And not as I DID.
Be logical, careful,
And organized too,
Or next Christmas the one with the tale
Might be YOU.
Now I bid you adieu,
And I slink out of sight…
Good investing to all,
And to all
A good night.
